A property can't be your main residence until you have lived it in. So you would be up for CGT for the first 6 months. But, the growth during this time would be minimal and there are deductions to apply against any gain/loss so you may not have to pay any tax.

bb8 wrote:
Thanks Terry for the information. It would be terrible to have to pay tax on the trust offset amount again. However I just thought of a disadvantage in "gifting" the money into the trust offset account. Basically that money will be locked within the trust from thereon and can only be "moved" between or within trusts, because say…[Read more]

No, gifts aren't income.

Think long term.If you own 99% now then you will pay 99% of the tax later. A property should only be negative for a short time and there will also be a  CG (otherwise there is no point).

1. NAB will probably require a separate package.2. Probably as 2 different entities/borrowers. You can negotiate.3. not necessarily.4. It is possible.I would suggest you get advice on taking the money from the offset to the trust. Is this a loan or a gift? each has different tax and asset protection consequences.

Your company will essentially have to transfer all the assets of the company to itself as trustee of the trust. This may mean CGT and stamp duty are payable – though since your company is new and may not have any assets then this will be minimal.Another option is to transfer the shares in the company to the trustee of the trust. Stamp duty and CGT…[Read more]

ps, you can only claim on the basis of title. If you were joint tenants with your wife you can only claim 50% of the costs and receive 50% of the income.

Joint tenants = holding an interest in land jointly with others. On death the others get you share, it does not fall under your will (unless you are the last one alive!).Tenants in Common = two or more people have distinct interests in land. These interests can be left in wills to others.Tenants in Common can be in different shares. Joint tenants…[Read more]

Good idea Dave

luke86 wrote:
Terry- Is is ok to use a LOC to pay for costs on an IP (such as rates, water, insurance etc)? And do you need a private ruling to be able to claim the interest that accrues on these costs or do you only run into problems if you are using a LOC to capitalise interest on an IP?Cheers,Luke

You can always borrow to pay expenses – but…[Read more]

Yes. It is a complex tax question and not a simple yes/no answer.If you do a search you will find many links I have provided to about 5 private rulings on this topic. I am on a different computer now so don't have them handy. Let me know later if you can't find them.

thats how i understood your post. You are borrowing to pay interest.

If you only have $27k private debt left, then this is not too much to worry about. You should be able to knock it over in a year.To speed things up you could look as using a LOC to borrow to pay expenses with the IP (in addition to that suggested above). Talk to your advisor about borrowing from the LOC to pay interest on your investment property…[Read more]

Is your broker a licenced Tax Agent? if not he has possibly committed an offence.This is possible, but it needs to be structured correctly for it to pass and you should get a private ruling as Luke mentions. Do a search for some links I have provided to private rulings on this 'scheme' – one was rejected.

Since you are spouses the lenders will usually take both into consideration, even if one is not a director and as long as she has an 'interest' in the structure such as shareholder, beneficiary.It is generally not a good idea to name too many people as beneficiaries directly as you may not want her to give a guarantee in the future and some…[Read more]

One of my friends bought a cashflow positive property in Sydney two years ago and it has doubled in value since. $1.5mil in CG. So it is still possible.

I was looking at some postgrad courses at the University of Western Sydney and they have some subjects in Property Investing. Atax at UNSW also have some subjects as part of the Master in Law/Tax & Fin Planning in Property Investing and taxation.

Don't worry too much. You should be alright.Yes you should keep mowing the lawns and keep insuring the property too until settlement.

This is the trouble you get when using a conveyancer.Even though a contract is unconditional the purchaser may still be able to get out of it in many instances. eg. If there is a search required to be included in the contract by law and you failed to include it this could be enough grounds for a purchaser to terminate the contract.If your property…[Read more]

Hybrid trusts can work if they are used commercially. But they have significant draw backs in trying to get a loan. Can you imagine your parents trying to get a loan to buy the units when the property title is in the name of you or a company? I don't think you will find a bank to do that these days.Also if your parents sold their units back to the…[Read more]